Correlation Between Aurora Mobile and Apptech Corp

Can any of the company-specific risk be diversified away by investing in both Aurora Mobile and Apptech Corp at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Aurora Mobile and Apptech Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Aurora Mobile and Apptech Corp, you can compare the effects of market volatilities on Aurora Mobile and Apptech Corp and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Aurora Mobile with a short position of Apptech Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aurora Mobile and Apptech Corp.

Diversification Opportunities for Aurora Mobile and Apptech Corp

-0.69

Correlation Coefficient

Aurora Mobile  Apptech Corp

Excellent diversification

The 3 months correlation between Aurora and Apptech is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Aurora Mobile and Apptech Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apptech Corp and Aurora Mobile is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Aurora Mobile are associated (or correlated) with Apptech Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apptech Corp has no effect on the direction of Aurora Mobile i.e., Aurora Mobile and Apptech Corp go up and down completely randomly.

Pair Corralation between Aurora Mobile and Apptech Corp

Allowing for the 90-day total investment horizon Aurora Mobile is expected to generate 6.76 times less return on investment than Apptech Corp. But when comparing it to its historical volatility, Aurora Mobile is 7.91 times less risky than Apptech Corp. It trades about 0.13 of its potential returns per unit of risk. Apptech Corp is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest  32.00  in Apptech Corp on April 24, 2025 and sell it today you would lose (2.00) from holding Apptech Corp or give up 6.25% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	49.18%
Values	Daily Returns

Aurora Mobile  vs.  Apptech Corp

Aurora Mobile

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Aurora Mobile are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak technical and fundamental indicators, Aurora Mobile reported solid returns over the last few months and may actually be approaching a breakup point.

Apptech Corp

Risk-Adjusted Performance

OK

Over the last 90 days Apptech Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly abnormal fundamental indicators, Apptech Corp showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Aurora Mobile and Apptech Corp

The main advantage of trading using opposite Aurora Mobile and Apptech Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aurora Mobile position performs unexpectedly, Apptech Corp can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Apptech Corp will offset losses from the drop in Apptech Corp's long position.

The idea behind Aurora Mobile and Apptech Corp pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Global Correlations module to find global opportunities by holding instruments from different markets.